The award of the Jomo Kenyatta International Airport (JKIA) modernisation contract to China Road and Bridge Corporation (CRBC) has entrenched the Chinese firm’s grip on Kenyan infrastructure, adding to other landmark projects such as the Standard Gauge Railway (SGR) and the Nairobi Expressway.
The JKIA deal pushes the value of projects under CRBC to over Sh1.2 trillion and deepens the Chinese firm’s influence in Kenya’s infrastructure development.
Transport and Roads Cabinet Secretary, Davis Chirchir, on Tuesday said that CRBC won the deal, which will entail building a new terminal and upgrading JKIA’s existing infrastructure for Sh154.2 billion to increase the airport’s passenger handling capacity from the current 7.5 million to 22 million upon completion.
CRBC’s growing influence in the big money deals embodies Kenya’s Look East policy, where China has turned out to be key in the construction of major projects in East Africa’s biggest economy.
The projects under CRBC’s helm have been funded through a mix of loans, mainly from China, and the Public Private Partnership (PPP) model, where investors fund and deliver projects, then operate them for a defined period to recoup their money.
On Tuesday, Mr Chirchir disclosed that CRBC had warded off competition from over 40 firms to win the JKIA deal, with the works expected to start in the coming months.
“Today, I witnessed the signing of the contract for the Jomo Kenyatta International Airport (JKIA) Modernization Project, a major National Infrastructure Investment,” Mr Chirchir said on Tuesday.
The JKIA deal comes barely nine months after a CRBC-led consortium bagged a contract to build the 233-kilometre Nairobi-Nakuru-Mau Summit toll highway, for Sh170 billion.
Some of CRBC’s PPP projects include the Nairobi Expressway and the Nairobi-Nakuru-Mau Summit highway project, with the rest including the SGR, financed through loans that have mainly been tapped from Chinese lenders.
CRBC entered Kenya during the era of the late President Mwai Kibaki and has since rooted itself as the single biggest foreign company in Kenya’s multi-billion-shilling projects in the last two decades.
China Communications Construction Company (CCCC) is the parent firm of CRBC with a stake of 99 percent. The remaining one percent is owned by China First Highway Engineering Company (CFHEC).
CCCC opened its regional office for East Africa in 2014 as it sought to tap into the vast market for infrastructure projects in Kenya, Burundi, Comoros, Djibouti, Ethiopia, Mauritius, Madagascar, Rwanda, South Sudan, Somalia, Tanzania, and Uganda.
CRBC delivered the SGR – Kenya’s biggest infrastructural project— whose total cost was $5.08 billion (Sh658.1 billion). The project was fully funded by loans from the China Export-Import Bank.
The Chinese firm constructed the Sh86.8 billion Nairobi Expressway, whose completion in 2022 has since eased gridlocks from the JKIA to Westlands, along a span of 27.1 kilometres.
CRBC delivered the Eastern, Southern, and Northern Bypasses in Nairobi between 2012 and 2022. The costliest of these was the Sh18 billion Southern Bypass, followed by the Sh9.3 billion Eastern Bypass. The Northern Bypass, which links Ruaka (on Limuru Road) to Ruiru (on the Thika Superhighway), was built for Sh8.5 billion.
CRBC is currently finalising the Sh46 billion Talanta Stadium, which will be the biggest such facility in Kenya. The project is funded via an infrastructure bond that was issued through a special purpose vehicle dubbed Linzi Finco.
Talanta, located on Jamhuri Grounds along Ngong Road, is slated to host the final of the 2027 African Cup of Nations. Kenya will jointly host the continental football showpiece with Uganda and Tanzania.
CRBC’s grip on Kenya’s infrastructure has also spread to the agricultural sector, with the Chinese firm set to build the Sh38.8 billion Galana dam.
The dam was initially to be developed under the Public Private Partnership, but the government has since dropped this model in favor of the engineering, procurement, construction, and financing (EPCF) framework.
The PPP model has helped CRBC to lengthen its stay in the Kenyan projects, given that its subsidiaries have been operating the projects for over 20 years, enabling the firm to recoup its money.
Moja Expressway has been maintaining and collecting tolls for the Nairobi Expressway for 27 years before handing over the project to Kenya.
CRBC and NSSF will also incorporate a firm to collect user fees for the Nairobi-Nakuru-Mau Summit highway for 30 years before relinquishing ownership of the highway to Kenya.
The Chinese firm’s growing influence was further exhibited when it snatched the Nairobi-Nakuru-Mau Summit highway project from a consortium of French firms, highlighting China’s deepening reach in Kenya’s grand infrastructural projects.
Kenya had already awarded the Nairobi-Nakuru-Mau Summit highway project to a consortium of French firms led by Vinci SA Highway.
But President William Ruto’s administration cancelled the deal in 2022, citing the Sh190 billion as costly. In October last year, a consortium of CRBC and the National Social Security Fund (trustees) was awarded the contract at a lower cost of Sh170 billion.
The growing foothold of Chinese firms, led by CRBC, has rattled contractors, triggering unsuccessful attempts by Parliament to change the law in a bid to protect Kenyan firms.
In October 2023, Parliament handed the Chinese firms a big lift after it rejected proposed changes that sought to limit the participation of foreign firms in the projects.
Lawmakers rejected the Public Procurement and Asset Disposal (Amendment) Bill of 2023 that sought to raise the limit for foreign firms bidding for contracts from Sh500 million to Sh20 billion.
The Bill that was aimed at protecting local contractors was shot down because few Kenyan-owned firms can afford to deliver high-value contracts.
Former Deputy President, Rigathi Gachagua, had, in 2020, while serving as an MP, sponsored a Bill that sought to only allow foreign firms to bid for contracts worth Sh1 billion and above. But the Bill was rejected, leaving local contractors with the huge task of competing with Chinese firms for the top-dollar contracts.
